Connect with us

Hi, what are you looking for?

Capital Business
Capital Business
Pedestrians walk past an advert of Japanese electronics giant Panasonic in Tokyo/AFP

World

Panasonic shares soar 19% after return to profit

Pedestrians walk past an advert of Japanese electronics giant Panasonic in Tokyo/AFP

Pedestrians walk past an advert of Japanese electronics giant Panasonic in Tokyo/AFP

TOKYO, February 5 – Panasonic shares rocketed 19 percent Wednesday after the struggling Japanese electronics giant said it swung into the black with a $2.4 billion profit in the nine months to December.

The Tokyo listed shares closed at 1,262 yen as investors reacted to the announcement, which came after markets closed Tuesday.

The stock had sunk seven percent in the previous session, hit by a broad market sell off.

Panasonic recovering from combined losses topping $15 billion in the past two fiscal years said net profit came in at 243.0 billion yen ($2.4 billion) in the first three quarters, reversing a net loss of 623.8 billion yen over the same period a year ago. Sales rose 4.4 percent.

The firm, which makes everything from appliances and televisions to GPS navigation products and batteries, credited its healthier balance sheet to cost-cutting, buoyant auto division sales, and a fall in the value of the yen.

The currency’s decline losing about a quarter of its value against the dollar has helped Japanese exporters by making them more competitive overseas and inflating repatriated profits.

Panasonic’s results come as the country’s once world beating electronics giants, including Sony and Sharp, undergo painful restructurings aimed at stemming years of record losses.

The struggling sector has faced serious challenges in recent years, with television sales plunging while rivals such as Apple and Samsung overtook them in the lucrative smartphone market.

Panasonic has said it will abandon the consumer smartphone market and stop production of plasma television screens, in line with a broader industry shift away from plasma units. Hitachi and Pioneer have also exited the market in recent years.

Sales of Panasonic’s household appliances and digital consumer products, including its struggling television business, remained weak as it shifts attention away from loss making divisions as part of a wider restructuring.

Advertisement. Scroll to continue reading.

Analysts have been calling on the sector to dump money losing businesses and shift their attention to profitable areas.

On Tuesday, Sharp booked a 17.7 billion yen net profit in the April-December period, reversing a whopping net loss of 424.3 billion yen a year earlier. Sales jumped 21 percent on brisk demand for panels, including its popular “IGZO” displays for mobile phones, said the maker of Aquos brand electronics.

Sony, which reports it earnings on Thursday, has also returned to profit after losing money four years in a row.

On Wednesday, Sony denied media reports that it was in talks to sell its struggling personal computer business, under the Vaio brand, to a Japanese investment fund.

Sharp shares slipped 2.83 percent to 308 yen by the close while Sony rose 4.57 percent at 1,600 yen.

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...